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Why Your Startup Should Care About Revenue Multiples
This story was originally published on HackerNoon at: https://hackernoon.com/why-your-startup-should-care-about-revenue-multiples.
Revenue multiples are valuation metrics based on company revenue. It is derived by dividing the enterprise value by the total revenue generated by the startup.
Check more stories related to finance at: https://hackernoon.com/c/finance.
You can also check exclusive content about #revenue-multiple, #startup-valuation, #revenue-multiples-for-startups, #startups, #startups-advice, #tools-for-startups, #startup-lessons, #startup-strategy, #hackernoon-es, and more.
This story was written by: @sarathcp92. Learn more about this writer by checking @sarathcp92's about page,
and for more stories, please visit hackernoon.com.
Revenue multiples are valuation metrics based on company revenue. This works best for startups because revenue is the only stable value compared to all other factors. These multiples provide an opportunity to bypass complicated company valuation calculations based on earnings and cash flows. Early-stage companies are just starting their business process, and it is difficult to account for all components of EBITDA. This gives a holistic picture of the current financial health of a startup. It is a reliable alternative to mainstream, popular valuation metrics that rely heavily on a company’s past financial records.
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By HackerNoonThis story was originally published on HackerNoon at: https://hackernoon.com/why-your-startup-should-care-about-revenue-multiples.
Revenue multiples are valuation metrics based on company revenue. It is derived by dividing the enterprise value by the total revenue generated by the startup.
Check more stories related to finance at: https://hackernoon.com/c/finance.
You can also check exclusive content about #revenue-multiple, #startup-valuation, #revenue-multiples-for-startups, #startups, #startups-advice, #tools-for-startups, #startup-lessons, #startup-strategy, #hackernoon-es, and more.
This story was written by: @sarathcp92. Learn more about this writer by checking @sarathcp92's about page,
and for more stories, please visit hackernoon.com.
Revenue multiples are valuation metrics based on company revenue. This works best for startups because revenue is the only stable value compared to all other factors. These multiples provide an opportunity to bypass complicated company valuation calculations based on earnings and cash flows. Early-stage companies are just starting their business process, and it is difficult to account for all components of EBITDA. This gives a holistic picture of the current financial health of a startup. It is a reliable alternative to mainstream, popular valuation metrics that rely heavily on a company’s past financial records.